Product Management as a Service Organization

Judy KirkpatrickVP, Global Product Management

March 2004

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Agenda

• What Does “Service Organization” Mean at eBay?• The PDA Organization• Where Product “fits” at eBay• The Product Development Process• Product and Design Principles• What We’ve Accomplished

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Definition of Service

Main Entry: ser·vicePronunciation: 's&r-v&sFunction: nouna : the work performed by one that serves <good service>b : HELP, USE, BENEFIT <glad to be of service> c : contribution to the welfare of others

©Meriam-Webster

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Whom Does PM “Service” at eBay?

• Product Strategy and Vision• Our eBay Community

– Buyers– Sellers

• Our eBay Business Partners– U.S.– International– PayPal

• Our Cross-Functional Partners– Trust and Safety– Billing and Collections– Customer Support

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The Four Types of Service Businesses

Business Horizons © 1999 by Indiana University Kelley School of Business.

ServiceFactory

ServiceComplex

ServiceStore

ServiceShop

Service Task

Routinized Knowledge

Serv

ice

Del

iver

y

Dec

oupl

ed

In

tegr

a ted

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eBay PM as a Service Complex

• We provide a broad range of customized, knowledge-based services that are delivered by various team members

• We must be flexible and adaptable to respond to varying business and community needs

• We add value through innovation and expertise, so creativity and initiative are critical

• Interactions with our community and business partners are close, very personal and very intense

• Our “clients” want to deal with specialists whom they know and trust

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Key levers for achieving “AAA” growth

“AAA”

Acquisition

Activity

Activation

Key Growth Levers

Marketing

Merchandising

Website

Category Management

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Delivering Excellent Service at eBay

• Base decisions based on what the customer wants and expects.

• Think and act in terms of the entire customer experience.• Continuously improve all parts of the customer experience.

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Checkout/Multi-Item PaymentsBefore After

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Delivering Excellent Service at eBay

• Base decisions based on what the customer wants and expects.

• Think and act in terms of the entire customer experience.• Continuously improve all parts of the customer experience.• Avoid failing your customers twice. • Empower members to “co-produce” their own experiences.• Create and sustain a strong mission and vision.

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Global PM’s Vision and Mission

Vision– We enable eBay’s Global Economic Opportunity– We empower eBay’s Community to reach higher levels of

success– We provide a world-class core-competency to eBay’s business

MissionWe design and build the people’s most efficient and abundantmarketplace.‒ We own and drive product vision and strategy and partner in

business strategy‒ We translate business and Community needs to product

requirements, while providing thought leadership, community advocacy and scalability to our global product platform

‒ We deliver innovative world-class products that grow eBay’s global business, making significant daily contributions to our Community and eBay’s success through our seamless execution.

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PDA | Product Development Architecture

Product Development & Architecture

Product Management

User Experience & Design

Process Eng & Metrics

Global Product Planning

Program Management

Product Strategy

Acquisition Integration

Architecture

Systems Development

Advanced Technology

Product Development

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Global Product Management Areas

SELLING

Anne Raimondi

BUYING

Amy Smith

TnS/CS/

COMMUNITY

BILLING

VikramSubramaniam

INTERNATIONAL

Anette Auyang, AAAMark Inkster, China

Jim Ambach, Europe

PLATFORM &

INFRASTRUCTURE

Michael Buhr

PRODUCT

STRATEGY

Shri Mahesh

Global Product

Management

Global Product

Management

Judy KirkpatrickJudy Kirkpatrick

MOTORS

Kirstin Hoefer

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ProductProduct StrategyProduct ManagementUser Experience DesignDevelopment & ArchitectureAdvanced TechnologyProject Management Product PlanningProcess EngineeringAcquisition Integration

Where the Product organization “fits”

The “BUs”The U.S. Business Unit

Grow the US business and categories

InternationalDrive international business and global expansion.

MarketingManage the eBay brand and attract users to the site.

Trust & SafetyEnsure a safe trading environment.

Customer SupportSupport end users

PayPalProvide a seamless payment option for eBay and become the dominant player in e-commerce payments.

CommunityHelp ensure our community is front and

center in everything we do.

OperationsSite OperationsQuality AssuranceIT

Deliver features and new capabilities to the site.

Support the site – make sure its operational for users.

Run the business side of the site.

The Site

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eBay product principles

• It’s about buying and selling

• Growth is essential• Level playing field• Think globally, solve locally• Create the “operating

system” for global e-commerce

• Data driven decisions• Satisfy the business, the

user and the Community

• Deliver world class quality, quickly and efficiently

• Follow all design principles• Enable open and safe

trading• Stay true to the brand• Evolution not revolution

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View Item/Bidding

After

Before

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Stores & Store BuilderStore Builder

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UED | Roles and Responsibilities

• Design User Interaction

• Design Information Architecture

• Design Information Flow

• Create visual style guide

• Design visual interface

• Concept and design creative solutions for marketing material

• Champion usability through content

• Provide editorial guidelines

• Establish content processes

• Build high-fidelity prototypes

• Develop UED productivity tools

• Provide technical consultation

UI Design Creative Design

Content Management Prototyping

Usability Engineering

• Champion the user

• Inform user-centered design

• Provide holistic site assessment

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eBay design principles

• It's about buying and selling

• Know your customer• Keep things simple• Don't make the user

work• Be consistent• Provide a well lit path• Do not divert users• Performance by design• Optimize for the 80%

• Make it personal• Help should be helpful• Think globally• Evolution not revolution• Build trust• Stay true to the brand• Design for the future• See the forest and the

trees• The user has the last

word

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Merchandising

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Sell Your Item (SYI)

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The Product Development Process

We look at the site as a product. We are constantly enhancing it to make it better. We call these enhancements “features”.

Multiple features get bundled together into software releases that are rolled to the site each week. We call these releases “trains”.

After features launch, we assess their success by tracking their affect on key metrics.

The Product Development ProcessThe Product Development Process

The Site (Our Product)“Trains”FeaturesBusiness Needs

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• Member Suggestions (emails)

• Online Panels

• Moderated Boards

• eBay University

• Voices

• Usability Studies

• US/Intl Surveys

• US/Intl Field Studies

• Moderated Boards

• Voices

• Usability Studies

• Prototyping

• Comps and Mockups

• Online surveys

Post-Launch Support• CS events (emails)• Boards• Voices• Answer Center• eBay University• Online surveys• Usability Studies• Product Exit Polls• Help

• Announcement Boards

• Onsite Previews

• Onsite Education

• Workshops

• Email

• Global Communication

Community Involvement

RolloutRolloutQATesting

QATestingDevelopmentDevelopmentRequirementsRequirements

PlanningScoping

NPVBooking

PlanningScoping

NPVBooking

ConceptConcept

We also engage our Community throughout our product lifecycle.

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My eBay

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Thousands of features & functions…

Major Site FunctionsRegistrationBuyingSearchBrowsing/CategoriesSellingMy eBayStoresCheckout/PaymentMuli-Item PaymentFeedbackMerchandisingFormats: Bid, BIN, Ad

Other ToolsSelling ManagerTurbo Lister TnS & CS Tools

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RolloutRolloutQATesting

QATestingDevelopmentDevelopmentRequirementsRequirements

How The Process Works

PlanningScoping

NPVBooking

PlanningScoping

NPVBooking

ConceptConcept

The BUs have a business objective to meet:BUs discuss idea with PM, they vet the idea and the BU writes a Business Requirements Document (BRD).

PM translates the BRD into a scope request with high level requirements outlinedTechnology scopes the projectBUs develop the business justification (NPV) and priority of the project, and work with the Product Council to get it approved based on company priorities.Product Planning works with development to ensure development resources are available to work on the project. After this is confirmed the project (feature) is “booked”.

PM writes a Product Requirements Document (PRD) detailing product functionalityUser Experience Design (UED) creates user interface prototypes, graphics, and conducts usability testing.

Development and architecture create the technical design and code the feature.

QA tests the featureThe feature is rolled out to the siteReceive user feedback and reactAssess success to original metrics and NPV

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Trains release every week -- alternating between US and international every other week. Our average train is 60,000 lines of code.

With ~7 US (core) trains releasing per quarter, our throughput is roughly a half million lines of code per quarter (not including international).

The total site is about 5 million lines of code. (In comparison, Microsoft Windows NT 3.1 was 4 million lines of code.)

This code supports over 90 million registered users from more than 200 countries, doing business on 20+ internationalized sites. On a daily basis, we support 700 million page views and $70 million in business transactions (Gross Merchandise Sales, GMS).

Even with this significant volume, our quality statistics are quite good: open production bugs are only a few hundred (>5 sigma), our site availability is 99.93%, and our customer support emails due to system issues is about 2% of our total volume.

RolloutRolloutRegressionTesting

RegressionTesting

FeatureTestingFeatureTestingDevelopmentDevelopmentDesignDesignRequirementsRequirements

RolloutRolloutRegressionTesting

RegressionTesting

FeatureTestingFeatureTestingDevelopmentDevelopmentDesignDesignRequirementsRequirements

RolloutRolloutRegressionTesting

RegressionTesting

FeatureTestingFeatureTestingDevelopmentDevelopmentDesignDesignRequirementsRequirements

e221

e221_Intl

e223

Some Key Statistics of Our Process

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Total Development Cost = Development Effort (Train Seats) + % of all supporting activitiesCreative QA

UI/Usability Project Mgmt Release MgmtProduct Mgmt Operations

RolloutRolloutQATesting

QATestingDevelopmentDevelopmentTechnical

Design

TechnicalDesign

BusinessRequirements

BusinessRequirements

• Each “Train” at eBay has a specific amount of capacity on it – train seats. Train seats reflect the amount of development effort associated with each train.

• Train seats also help communicate the quarterly development capacity of the Product organization.

• Train seats are a commitment to the business – they are not just effort spent, but rather effort “earned”.

• To determine the cost of a train seat, eBay bundles in the effort required by non-development resources such as product management, usability testing, QA and project management.

Train Seat = Development Effort (1 Train Seat = 15 Developer Days)

Another Key Metric: Train Seats

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28x1,12040Train Seats Per QuarterNA13 M0Web Service API calls

7x6.3 M0.9 MBids

12x$6.4 M$532 KNet Revenue Per Day

15x93 M6 MTotal Registered Users*

21x21 M1.0+ MOutbound e-mails

13x700 M54 MPage views

18x120 M6.5 MSearches17x7.8 Gbps268 MbpsPeak Network utilization

10x$70 M$6.5 MGMS Per Day

8x30040Developers99.93%

3 M

Dec 2003

6x532 KListings3%~97%Availability

GrowthJune 1999In a typical day…1. Scalability

2. Availability

3. Productivity

4. Capacity

5. Platform

* Total registered uses is the cumulative total, not per day or quarter.

What we’ve accomplished

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Yet, Still Early Stage of eBay’s Growth

High risk / High risk / High rewardHigh reward

Early / High Early / High growthgrowth

Mature / Slow Mature / Slow growthgrowth

EmployeeProfile

Lower risk Lower risk lower rewardlower reward

eBay

Explorers• Survivalists• Extremely high risk/high reward• Can deal with no infrastructure• Lean staff

PayPalthru ‘02

Pepsi

Microsoft

GapP&G

Entrepreneurs• Bold entrepreneurs to go after white space• High risk/high reward/high output• Fast to deliver, fast to respond• Strategy under rapid change• Experienced at building to last • Rapid hiring ramp -- exec bench building

Implementers• Savvy competitors• High execution of proven strategy• Protectors of growing legacy• Moderate hiring needs

Maintainers• Solid execution of known strategy• Guardians of legacy• Low to no hiring• Internal mgt development

eBay is a young, exciting company. It has infinite opportunities which create an unpredictable, rapidly changing environment. eBay’s employees are driven and excited about changing the world. They work hard and strive to capitalize on the many opportunities the company has to grow.

Stage of Company

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Relative gross merchandise sales – US

Billions

Source: eBay Inc. estimate

Q303 Annualized GMS

$14

Next leading online retailer

Fixed Price

Auction

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Outpacing Leading Growth Companies

(1) Sales and GMS adjusted to 2002 (2) Source: eBay; Company Filings; US Department of Commerce Deflators

1

10

100

1,000

10,000

100,000

1,000,000

1 5 10 15 20 25 30 35 40Years from incorporation

GMS

2002 MM$ (log scale)

Thank You!